Consider the following two mutually exclusive projects.   Time                Project A                                 Project B 0                      -$300                                       -$405 1                      -$387                                       $134 2                      -$193                                       $134 3                      $100                                       $134 4                      $600                                       $134 5                      $600                                       $134 6                      $850                                       $150 7                      $180                                       $284 What is each project’s payback, discounted payback, IRR, and NPV with a cost of capital of 12%? Which project should be selected?

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.